About this Show

60 Minutes on CNBC

Computer Giants News/Business. (2012) Pattie Dunn; captain of capitalism; Carly.

NETWORK

DURATION
01:00:00

RATING

SCANNED IN
San Francisco, CA, USA

SOURCE
Comcast Cable

TUNER
Virtual Ch. 58 (CNBC)

VIDEO CODEC
mpeg2video

AUDIO CODEC
ac3

PIXEL WIDTH
704

PIXEL HEIGHT
480

TOPIC FREQUENCY

Pattie Dunn 17, Perkins 15, Tom Perkins 11, Carly Fiorina 11, Hp 10, Us 7, Compaq 4, Lesley 4, Jay Keyworth 4, Geico 4, Genentech 3, Hewlett-packard 3, Dunn 3, California 2, America 2, Google 2, Falcon 2, Legalzoom 2, At&t 2, Kleiner Perkins 2,
Borrow a DVD
of this show
  CNBC    60 Minutes on CNBC    Computer Giants  News/Business.  (2012)  
   Pattie Dunn; captain of capitalism; Carly.  

    March 24, 2013
    11:00 - 12:00am EDT  

11:00pm
ha ha! no no no! not today! ha ha ha! ha ha ha! jimmy how happy are folks who save hundreds of dollars switching to geico? happier than dikembe mutumbo blocking a shot. get happy. get geico. fifteen minutes could save you fifteen percent or more. governor of getting it done. you know how to dance... with a deadline. and you...rent from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. this is awesome. [ male announcer ] yes, it is, business pro. yes, it is. go national. go like a pro.
11:01pm
♪ [ male announcer ] from the way the bristles move to the way they clean, once you try an oral-b deep sweep power brush, you'll never go back to a regular manual brush. its three cleaning zones with dynamic power bristles reach between teeth with more brush movements to remove up to 100% more plaque than a regular manual brush. and even 76% more plaque than sonicare flexcare in hard to reach areas. oral-b deep sweep 5000 power brush. life opens up when you do.
11:02pm
>> maybe someone will come in here while we're talking and put handcuffs on me. i don't know. >> pattie dunn has been charged with four felonies. she's at the center of the hewlett-packard leak investigation story. >> i have a story to tell. i'm innocent. >> it's one of the biggest, fastest, most high-tech sailboats on the high seas... >> isn't she beautiful? >> ...a triumph of science, vision, money, and an abundance of ego. >> i just wanted the biggest
11:03pm
boat. let's admit it. >> it's ego. what? i mean... >> do i have an ego? yes. >> if there were a hall of fame for business tycoons, tom perkins would be a first-ballot shoo-in. he has earned a fortune, and, boy, does he know how to spend it. [ engine revs, tires screech ] >> the troubles at hewlett-packard started when then-c.e.o. carly fiorina was abruptly fired. >> out the door. is that really -- it was that cold? >> that's exactly what happened. >> devastated? you had to have been. >> of course i was devastated. i was hurt. >> welcome to "60 minutes on cnbc." i'm lesley stahl. in this edition, we examine the boardroom intrigue at hewlett-packard between 2005 and 2007. it was a tumultuous saga that led to criminal charges, executive firings, accusations of sexism, and lots and lots of
11:04pm
finger-pointing. and in the midst of it all, three of the protagonists told me their sides of the story -- pattie dunn, thomas perkins, and carly fiorina. we begin with pattie dunn. it was 2005, and she was appointed chairman of hewlett-packard. yet just 20 months later, dunn was gone from hp due to her participation in an internal investigation that involved spying on members of the board. less than a month later, dunn was charged with four felony counts for her role in that investigation. in october 2006, only hours after the criminal charges against her were announced, pattie dunn sat down with me to talk about what happened at hewlett-packard. let me ask you the obvious question that i think every lawyer who's watching this is asking himself or herself. why are you giving us an interview right after you've been indicted?
11:05pm
it's pretty unusual. >> so my lawyer tells me. [ chuckles ] >> well, he's approving of this, isn't he? >> he is. i have a story to tell. i'm innocent. i need people to understand what happened, and i'm glad to have this chance to do it. >> her story involves the investigation into who from the board was leaking confidential information to the press about corporate strategy, hp's interest in buying another tech company, even deliberations over who they would hire as c.e.o. >> the idea that the most sensitive discussions of the board would end up on the front page of the wall street journal was destructive. it destroyed the trust between people, and if they don't trust each other, they can't function as a board. >> a majority of the board asked dunn to initiate a leak inquiry, which soon ran amuck... [ camera shutters clicking ] ...and has made her the public face of one of corporate
11:06pm
america's biggest scandals. >> we're here on a troubled day. >> great disappointment here. >> it is not believable. >> what in the world were you thinking? >> sir... >> she accepts no responsibility, admits no wrong. at the heart of the case, what did pattie dunn know about the pretexting, or the use of pretenses, to get phone records? evidence includes a conference call, apparently with dunn, during which pretexting was allegedly discussed, and notes of an interview with dunn about the case. "dunn thinks it is probable that she was told, 'in some circumstances, they may need to use false pretenses.'" >> i refute those notes. i was never given a chance to review them. this is not a deposition. this was not recorded. if it's going to be used as evidence against me, somebody needs to take my deposition. >> and perhaps the most serious charge against her involves passing along personal information to the investigators to enable the pretexting. the complaint specifically
11:07pm
mentions that you gave the investigators the home phone numbers of your fellow board members. >> i don't remember giving the investigators the home phone numbers of my fellow board members, but those are not hard to get within hp. they're public information within the board infrastructure. >> at a news conference, an hp lawyer said dunn had instigated and closely monitored the probe, and c.e.o. mark hurd also weighed in. and he termed the tactics "disturbing." he's the one who pointed the finger at you. >> well, that's a mischaracterization of my role. >> but why would he do that? >> you'd have to ask him, lesley. i'm not gonna speculate on other people's motivations here. >> she maintains that, at every step of the way, she relied on senior hp lawyers to ensure that everything was done legally.
11:08pm
isn't it just wrong? isn't it just ethically wrong -- forget whether it's legal or not -- to go in and get people's phone records? >> people who sit on public company boards have a very different attitude about this than probably the general public. first of all, you give up a lot of privacy when you go onto a board. you have to make all kinds of declarations. your life is much more an open book when you have this kind of a public trust. >> but what about the reporters? it wasn't just board members. it was reporters, as well. >> that was just wrong. that was wrong. i found out about that on september 6, 2006. the idea that i supervised, orchestrated, approved all of the ways in which this investigation occurred is just a complete myth. it's a falsehood. it's a damaging lie. >> coming up, dunn on former hp board member tom perkins.
11:09pm
>> it was a disinformation -- a classic disinformation campaign, and he set the mind-set for basically everything that's believed about this right now. >> that's ahead, when believed about this right now. >> that's ahead, when "60 minutes on cnbc" returns. ♪ if loving you is wrong ♪ i don't wanna be right [ record scratch ] what?! it's not bad for you. it just tastes that way. [ female announcer ] honey nut cheerios cereal --
11:10pm
heart-healthy, whole grain oats. you can't go wrong loving it.
11:11pm
11:12pm
>> in october 2006, just hours after being charged with four felony counts, former hewlett-packard chairman pattie dunn told me that she was innocent of all charges against her. dunn also claimed that she was the victim of a disinformation campaign run by former hp board member thomas perkins. the focus on her started, she says, after the investigation identified board member and nuclear physicist jay keyworth as the source of many of the leaks. another board member, tom perkins, she says, wanted to keep that secret from the full
11:13pm
board. >> well, they were best friends. they were allies on the board, and i think he thought it was a possibility that the board would say the leaker should resign. he just didn't want that outcome. >> i don't understand how you have an investigation and there's even a discussion of not revealing who the culprit is. >> what tom believed was that we would simply tell the leaker never to do it again, then we would inform the board that we had identified the leaker, that he had confessed and agreed he would never do it again. "next item on the agenda." >> we couldn't reach tom perkins, since he is out to sea on his new boat, said to be the largest and most expensive private sailboat ever built. he's a founding partner of the venture capital firm kleiner perkins that has bankrolled aol, google, and amazon, among others. dunn says he's a guy who definitely knows how to get his way, but he couldn't get his way
11:14pm
with pattie dunn. she refused to keep that keyworth was the leaker a secret. the board asked keyworth to resign, and in a peek behind the scenes at how things can explode on a board, dunn says perkins walked out in a huff. >> he turned to me, pointed at me, and said, "you betrayed me." he said that several times. "you betrayed me, pattie. you said that we would handle this offline, and a good man is being ruined as a result," and he snapped his briefcase shut and stormed out of the room and said, "i resign." and one of the other directors said, "can we accept his resignation?" the general counsel said, "yes." he put the motion on the table. it was seconded and passed within seconds. >> and that was that? >> that was that.
11:15pm
so, he drove off and ended up going onto his mega-yacht in the mediterranean, and i suspect he thought over the ensuing days that it was just unacceptable that he was off the board, jay was going to be off the board, and i was still chairman. >> after that, perkins blew the whistle on hp's leak investigation, and she says he began a campaign of deceit about her. >> it was a disinformation -- a classic disinformation campaign, and he set the mind-set for basically everything that's believed about this right now. >> she says he sent out this e-mail disparaging her, and he influenced the media. >> the newsweek cover that said "the boss," which i wasn't, "who spied," which i didn't, "on her board," is really now fixed in the minds of the public as a result of a campaign to put it there. >> she even accuses him of bringing his campaign against
11:16pm
her to law enforcement. >> he and his team went to see various agencies of government and law-enforcement agencies. >> about you? >> that's what i am told -- that that's exactly what they did. >> a spokesman for perkins confirmed that, indeed, he did go to the s.e.c., the f.t.c., the justice department, and the california attorney general to complain about the tactics used in the leak investigation. >> if you have enough money and you're willing to spend enough, you can buy and sell somebody's reputation. >> and you're charging that's what he's done? >> that's is what he did. >> you're saying, if i understand you, that tom perkins set out to get you? >> he wanted me off the board. this was to get me off the board. i don't know if he ever thought through the consequences that would go beyond my getting off the board. >> well, you said he went to law enforcement. >> well -- >> that takes it another step. >> it does take it another step, and here i am today with an
11:17pm
indictment over my head. >> are you saying he's responsible for that? >> well, i don't think i'd be sitting here today if tom had handled this differently. >> we have learned that perkins made several settlement demands on hp -- that the company pay his legal fees, that pattie dunn be forced to resign, and that the company not disparage him or jay keyworth. this is what c.e.o. mark hurd said on september 12, 2006, in a news release. he said, "jay keyworth leaves the board with our best wishes and gratitude." here's what i have trouble understanding. everybody says leaks are bad, the leaker is identified, and now there's a settlement with him. >> mm-hmm. go figure. [ laughs ] >> do you understand this? >> well, at that point, i think that the company thought it was in the best interests of hp to get tom off its back, so to speak.
11:18pm
>> all rise. >> pattie dunn appeared in a san jose courtroom. she's not just fighting for her reputation. she's also fighting for her life. this has all happened as she battles stage-4 ovarian cancer. you are gonna start a full round of chemotherapy -- severe chemotherapy -- day after tomorrow. >> 8:45 a.m. >> 8:45 a.m. and you're charged with this. it's just all piling on you at once. and you're so strong. >> what's the alternative? >> well, breaking down, getting in the back of a closet and sitting there. i can think of lots of things that other people -- >> well, the golden gate bridge is always out there. it's not going away. i mean, you just have to fight back. >> do you think your illness has made you -- what's the word -- philosophical? >> definitely. having a criminal indictment is the last thing i ever expected in my entire life.
11:19pm
but if i hadn't had four diagnoses of cancer, i would probably think it was the worst thing that could ever happen to anyone, and i know it's not. >> in march 2007, all criminal charges against pattie dunn were dropped by the california attorney general's office. her battle against cancer continued until december 2011, when pattie dunn died at age 58. coming up, tom perkins gives us a tour of his mega-yacht and talks about his relationship with pattie dunn. how much did you hate her? >> i don't hate her. >> come on. i know you couldn't stand her. >> i disagreed profoundly with the direction she was pulling hewlett-packard. >> the captain of capitalism, hewlett-packard. >> the captain of capitalism, next on "60 minutes on cnbc."
11:20pm
[ female announcer ] it's time for the annual shareholders meeting. ♪ there'll be the usual presentations on research. and development. some new members of the team will be introduced. the chairman emeritus will distribute his usual wisdom. and you? well, you're the chief life officer.
11:21pm
you just need the right professional to help you take charge. ♪
11:22pm
to help you take charge. you know it can be hard to lbreathe, and how that feels.e, copd includes chronic bronchitis and emphysema. spiriva helps control my copd symptoms by keeping my airways open for 24 hours. plus, it reduces copd flare-ups. spiriva is the only once-daily inhaled copd maintenance treatment that does both. spiriva handihaler tiotropium bromide inhalation powder does not replace fast-acting inhalers for sudden symptoms. tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. these may worsen with spiriva. discuss all medicines you take, even eye drops. stop taking spiriva and seek immediate medical help if your breathing suddenly worsens, your throat or tongue swells, you get hives, vision changes or eye pain, or problems passing urine.
11:23pm
other side effects include dry mouth and constipation. nothing can reverse copd. spiriva helps me breathe better. (blowing sound) ask your doctor about spiriva. >> if there were a hall of fame for business tycoons, tom perkins would be a first-ballot shoo-in. the firm he founded, kleiner perkins caufield & byers, promoted start-up capital for companies like amazon.com, netscape, and google, among many others. and as we reported in 2006, he was also at the center of hewlett-packard's boardroom battles in the early 2000s. one of those triggered a confrontation that brought to light how hp was spying on its own board members and journalists and led to the resignation of the company's chairman, pattie dunn. as we reported in november 2007, perkins has a reputation for
11:24pm
being brilliant, willful, and wealthy, lacking nothing but perhaps a tad of humility. this is tom perkins' own personal mega-yacht, the maltese falcon, the world's largest privately owned sailboat -- what one magazine called "a big boatload of ego." >> somebody has to have it, right? >> "someone -- someone has to do this. why not me, right?" >> why not me? >> [ laughs ] when i first saw the boat, it was moored off the coast of italy. >> isn't she beautiful? >> she's also a technological breakthrough. the masts stand 192 feet tall, weigh 25 tons each, and are made of carbon fiber. >> the b-1 bomber is made out of carbon fiber. except for the american air force, i've purchased the most carbon fiber of anybody ever. >> on board, the boat is no less spectacular... >> there you go. you're aboard. >> ...or over the top. on a scale of 1 to 10, it's a
11:25pm
12. you know, i'd never had the sense of how long the boat is until now. >> it's your typical football-field-sized yacht, you know? >> [ laughs ] inside, there were two 1,800-horsepower engines, 11,000 square feet of living space, and his crew of 20 includes a gourmet chef and a team of stewards and stewardesses. >> keep that sugar away from me. so, here's the wheelhouse. >> the wheelhouse. >> come on in. >> the wheelhouse, or captain's bridge, is command central for the boat's technological wizardry. >> this is my invention. this is my baby, and i'm gonna teach you how to sail this boat. >> yeah, right. perkins designed the software himself for the computers that make sailing on the falcon as easy as playing a computer game. >> real simple. real simple. >> you know the wheel a skipper uses to steer a boat? well, the falcon's is much smaller than that. >> i'm gonna turn this knob.
11:26pm
>> this knob turns the masts so that the wind, signified by the yellow arrows, blows into the sails at the perfect angle. >> turn the masts like that. >> and you're gonna tell me when to stop. >> yeah, just keep going. keep going. >> oh, the arrow keeps shifting. >> little more. you're about there. okay. you like that? okay. say "start." >> and it's doing it. >> the mast is turning. >> next, he showed me how to unfurl the boat's 15 sails, a job that would take about 80 deckhands an hour on a traditional sailboat. all it takes on the falcon is five minutes and the touch of a screen. >> let's go sailing. >> let's go sailing. and just like that, the sails, housed inside those hollow carbon-fiber masts, begin to unfurl -- all 26,000 square feet of them. that's over half an acre's worth of sail. >> okay. that wasn't too hard. >> no. the maltese falcon embodies all the grandeur of a
11:27pm
19th-century clipper ship. it's also one of the biggest, fastest, and most high-tech sailboats on the high seas -- a triumph of science, vision, and money. so, how much did it cost you? >> [ laughs ] the rule of thumb, lesley, is that a big yacht costs about $1 million a meter. >> and how many meters are we talking about? >> we're 88 meters. >> oh, i know it costs more than $88 million. i've heard about $150 million, but i've also heard $300 million. >> no. not $300 million. >> okay. that's too much. >> that's too much. >> why won't you tell us? you've told us everything else. you don't seem to be embarrassed about everything else. >> [ laughs ] i'm embarrassed about that. >> about how much it costs? >> yeah. >> because...? >> there's the homeless and charity, and there's lots of things you could do with that money that would improve the world, right? >> oh, good point that you bring up yourself.
11:28pm
>> yeah. >> wow. >> so, you know, "how selfish is this guy?" i guess is the criticism. so, the answer's "pretty selfish," but i'm just not gonna put a number on it. >> why did it have to be the biggest boat? >> lesley, i could give you some technical reasons on why it really has got to be big to work right, but i just wanted the biggest boat. let's admit it. >> it's ego. what? i mean... >> do i have an ego? yes. >> we know that already. >> is it big? yes. >> coming up, turmoil at hewlett-packard. just slammed your briefcase cover and walked out. i mean, that sounds like a hissy fit of some kind. >> i was angry. there's no question. >> so, it was like a little mini-tantrum? >> it was 90 minutes of very intense debate. i would say i was emotional more than angry, although that's
11:29pm
maybe the same thing. >> that's next when maybe the same thing. >> that's next when "60 minutes" on cnbc" returns. great first gig! let's go! party! awwwww... arigato! we are outta here! party...... finding you the perfect place, every step of the way. hotels.com
11:30pm
♪ ♪
11:31pm
[ male announcer ] it was designed to escape the ordinary. it feels like it can escape gravity. ♪ the 2013 c-class coupe. ♪ starting at $37,800.
11:32pm
>> perkins made his name and fortune in venture capitalism, which he chronicles in his memoir, "valley boy: the education of tom perkins." it is a candid account of his life, his second marriage to romance novelist danielle steel, a manslaughter conviction in a boating accident in france, and the deals that made him so wealthy, starting with the first biotech company, genentech, here in san francisco. he and his partners launched genentech in 1976 with nothing
11:33pm
more than a checkbook and an idea. >> the idea was to trick nature into letting us make something that didn't exist in nature -- in particular, human insulin. >> genentech's success led to new ways of treating everything from diabetes to dwarfism, and to getting rich. kleiner perkins' initial investment of $250,000 soared 800-fold to $200 million. >> that's what venture capitalists are created to do, and you can blame converting the orchards of silicon valley into parking lots partly on me and partly on genentech, because we proved that this kind of high-risk, high-tech venture capital could be an enormous home run, and everybody wanted to get in on it, including lots of entrepreneurs, and that's what got this whole silicon valley engine rolling, in my opinion. >> and it took somebody like perkins, with a background in
11:34pm
science, to figure it out. he got an engineering degree from m.i.t. and an mba from harvard business school, and yet, he says, only two out of about every 10 of his projects resulted in a home run. when you think about putting as much money as you have to into these projects, you'd think you'd get an ulcer or you'd burn out early. >> i remember one of our investors said, "tom, how do you live with this?" and i said, "well, henry, it's your money." [ laughs ] >> perkins is now a partner emeritus at the firm he founded. he seemed about ready to sail off into the sunset when suddenly, at age 74, his life and legacy took a controversial turn. as a member of hewlett-packard's board of directors, he played a role in the 2005 sacking of carly fiorina, the computer giant c.e.o., and a year later, the ouster of its chairman of
11:35pm
the board, pattie dunn. they both went public on "60 minutes" and, in separate interviews, accused him of engineering their dismissals. is it possible that part of the problem was that you just couldn't accept that there were women in control, here? no, it's a serious question. >> i realize it's a serious question, and i also realize that i'm gonna be accused of "he hates women, and he fires them, or he can't stand them," or whatever. you know, maybe -- >> not hates women, but just can't stand that they're in control -- that they're in charge. that kind of thing. >> i just don't think that's true at all. i mean, up until carly, all those few that i've had to fire have been men. >> he denies he engineered carly fiorina's firing, but he acknowledges he engaged in a test of wills with board chairman pattie dunn. at a crucial meeting, perkins got so mad at her that he resigned from the board, losing
11:36pm
his legendary temper. just slammed your briefcase cover and walked out. i mean, that sounds like a hissy fit of some kind. >> [ laughs ] i was angry. there's no question. >> so, you responded -- it was like a little mini-tantrum? >> it was 90 minutes of very intense debate. i would say i was emotional more than angry, although that's maybe the same thing. >> after he resigned, by his own admission, he waged a behind-the-scenes campaign to get dunn removed as chairman of the board. dunn calls it a vendetta to tarnish her reputation. >> if you have enough money and you're willing to spend enough, you can buy and sell somebody's reputation. >> and you're charging that's what he's done? >> that is what he did. >> how much did you hate her? >> i don't hate her. >> come on. i know you couldn't stand her. >> i disagreed profoundly with the direction she was pulling
11:37pm
hewlett-packard. >> you told someone i know, "i can't stand to breathe the same air she breathes." >> i don't recall saying that. >> when perkins resigned from the hp board, he ended a long association with the company. >> do you miss being on the hp board? >> yes. i miss being on the hp board. maybe i made a mistake in resigning as i did. >> do you regret it? >> yes, i regret it. >> he's moved on, though. he's a member of the board of rupert murdoch's news corp, and there are few pleasures that money can buy that he denies himself or that he doesn't like to show off. [ engine revs, tires screech ] >> let's go through the tom perkins litany. you used to own the world's most expensive sports-car collection. >> the best. maybe the most expensive. >> okay. you currently own a bentley, a
11:38pm
$450,000 porsche carrera gt, an aston martin, the maltese falcon, and a second yacht. who needs two yachts? well, we won't go into that. you own a 900-year-old moated estate in england, and i'm only telling what we know about. so, you do like to show off. >> guilty as charged. >> analyze that for us. why do you have to have the biggest and the first? what is that? >> you know, i'm no psychiatrist, but it probably comes from my childhood and the attitude of my parents. >> an only child, perkins grew up during the depression, which he says devastated his father and distorted his mother's priorities. >> my mother wanted things in life that my father couldn't provide, that were bought by money. the fact that we didn't have any money was very, very evident
11:39pm
always in my life. >> 'cause she talked about it? >> she talked about it all the time. >> and so he cares about money, and he likes to spend it. this is his latest project -- his very own sports submarine, his newest high-tech toy, which he'll park on the forward deck of the maltese falcon. if you got it, flaunt it and poke fun at yourself, as he does when he dresses up his yacht with flags and pennants, each of which, in sailor speak, represents a letter of the alphabet. what does it say? >> yeah, lesley, starting from the bow, it really says this -- "rarely does one have the privilege of witnessing vulgar ostentation displayed upon such a scale." >> so, you're saying it yourself before anyone else can say it. self-protection here. but there's no protection against boredom when it comes to tom perkins. he sold the maltese falcon in 2009 for a reported
11:40pm
$120 million. he says the allure of the mega-yacht was in building it and in overcoming its technical and its aesthetic challenges. in september 2011, news corporation announced that perkins was standing down from its board of directors. coming up, blindsided by the board. >> none of the normal business reasons apply. i know that. there were no improprieties, there were no ethics issues, so i can only conclude that it was personal in some way. certainly, the way it was done was personal. >> carly fiorina on her ouster at hewlett-packard, when >> carly fiorina on her ouster at hewlett-packard, when "60 minutes on cnbc" returns.
11:41pm
license and registration please. what's this? uhh, it's my geico insurance id card, sir. it's digital, uh, pretty cool right? maybe. you know why i pulled you over today? because i'm a pig driving a convertible? tail light's out.. fix it. digital insurance id cards. just a click away with the geico mobile app. omnipotent of opportunity.
11:42pm
you know how to mix business... with business. and you...rent from national. because only national lets you choose any car in the aisle. and go. you can even take a full-size or above. and still pay the mid-size price. i could get used to this. [ male announcer ] yes, you could business pro. yes, you could. go national. go like a pro. it's delicious. so now we've turned her toffee into a business. my goal was to take an idea and make it happen. i'm janet long and i formed my toffee company through legalzoom. i never really thought i would make money doing what i love. [ robert ] we created legalzoom to help people start their business and launch their dreams. go to legalzoom.com today and make your business dream a reality. at legalzoom.com we put the law on your side.
11:43pm
this is america. we don't let frequent heartburn come between us and what we love. so if you're one of them people who gets heartburn and then treats day after day... block the acid with prilosec otc and don't get heartburn in the first place!
11:44pm
>> if it sounds like the hewlett-packard board was dysfunctional during pattie dunn's tenure, it was just as bad when carly fiorina was c.e.o. and board chairman and considered the most powerful woman in american business. in february 2005, fiorina was fired abruptly and very publicly, with striking parallels to dunn. both women were forced out of hp, and both lashed out at some of the members of the
11:45pm
male-dominated board. so, why was carly fiorina fired? in october 2006, she talked with me about it for the first time. why did the board fire you? >> you know, lesley, i wish i could answer the question "why did the board fire me?" i can't. they never had a conversation with me. >> it was just out the door. is that really -- it was that cold? >> that's exactly what happened. >> devastated? you had to have been. >> of course i was devastated. i was hurt. >> one reason she was so blindsided, she says, is because after five years of her leadership, the company was on a roll. >> a company that went from not being in the top 25 innovators in the world to leaping up to number three, a company that was profitable in every business line, a company whose brand had gone from stodgy, white male -- honestly, that's what the
11:46pm
research said -- to leading-edge, relevant. this was a company transformed from a laggard to a leader. >> and transformed, she says, because of her strategies, her vision, and her management skills. so, when the board of directors showed her the door, she hadn't seen it coming. >> none of the normal business reasons apply. i know that. there were no improprieties, there were no ethics issues, so i can only conclude that it was personal in some way. certainly, the way it was done was personal. >> carly's book documents it all, from the hiring to the firing, which was like a public beheading -- a devastating rebuke after an almost-flawless career. by her own telling, she was always driven -- first, when she wanted to be a concert pianist and practiced every day for hours and hours, then at
11:47pm
stanford, where she graduated with honors. >> you took classic greek in college so that you could read aristotle in the original? >> that's true. >> and then, on top of that, you took german, italian. >> once i dive in, i dive in all the way. >> that's what she did at at&t, where she started out as an entry-level sales rep. >> what we're about... >> she worked her way up, eventually directing the then-largest initial public offering in history, the $3 billion spin-off of lucent technologies. >> we are out to be clearly number one. >> that deal put her on the map, turning her into a celebrity c.e.o., whom everyone just called "carly," and it led to her hiring at hewlett-packard in 1999. she was just 44, the first woman to lead a company that big. founded in this garage during the depression by bill hewlett and dave packard, the
11:48pm
once-dominant hp fell behind in the '90s, and the board of directors wanted carly to come in and shake things up. but she came up against a culture that didn't want to be changed. >> if someone offered a new idea, people would say, "oh, we don't do it that way. it's not the hp way." so, it became a shield against change. >> she persevered, though, and in time, orchestrated a huge change -- the merger with compaq. >> yeah, this is a big damn deal, but we can pull this off. >> the board backed the deal 100%, but merging with the more trendy, edgy compaq was seen by some insiders as an attempt to kill off the old hp way. it didn't help that she had made herself the face of the company or that she had starred in a commercial in front of the old sacred garage. >> today, the company of bill hewlett and dave packard is being reinvented. i mean, if i had it to do over,
11:49pm
i probably wouldn't have gone into those commercials, because i think it made me, perhaps, even more of a target. >> it couldn't have helped with the families -- the hewletts and the packards. they turned against the merger with compaq and against her. >> the families took out an ad at one point, and they said that you were "incompetent, unethical, unfit." >> oh, look. i think the fight got very ugly. very ugly things were said about me, and my job was to set that aside and get done what i had to get done. >> did you put it aside? were you able to push it over there and...? >> except when i came home at night. you know, you have to have a safe place you come home to. >> do you acknowledge that you weren't running the nuts and bolts? >> no, i won't acknowledge that. i absolutely won't acknowledge
11:50pm
that. i was running the nuts and bolts of this company, along with a lot of other people. >> but do you acknowledge that the board felt you weren't? >> no. that's not factual. >> carly fiorina answers her critics when >> carly fiorina answers her critics when "60 minutes on cnbc" returns. hey! did you know that honey nut cheerios
11:51pm
has oats that can help lower cholesterol? and it tastes good? sure does! wow. it's the honey, it makes it taste so... well, would you look at the time... what's the rush? be happy. be healthy. ♪ [ male announcer ] every car we build must make adrenaline pump and pulses quicken. ♪ to help you not just stay alive... but feel alive. the c-class is no exception. it's a mercedes-benz, through and through. see your authorized mercedes-benz dealer for exceptional offers through mercedes-benz financial services.
11:52pm
11:53pm
because what you don'tubenz know can hurt you.rance. what if you didn't know that weeping willows have invasive roots? what if you didn't know that a trampoline... could affect your liability? and what if you didn't know that most cars... get broken into when the weather warms up? here, buddy.
11:54pm
the more you know, the better you can plan for what's ahead. get smarter about your insurance. ♪ we are farmers bum - pa -dum, bum - bum - bum - bum ♪ >> while leading hewlett-packard's controversial merger with compaq, carly fiorina faced opposition from within the company. walter hewlett, son of the company's co-founder, launched a proxy fight against the merger. during this lengthy, very public storm over her vision for the company, fiorina took comfort in having at least one safe haven. that safe place was home with her husband, frank fiorina. when he was 49 and a vice president at at&t, where they had met, he retired in order to support her career. >> did you ever ask her, "why don't you retire?" >> no, because it would have been futile, and it would have been a waste of time. >> that was not in the cards? >> no. >> what frank did was watch her back by attending board
11:55pm
functions and senior leader meetings, and he would tell her the unvarnished truth. he was at her side at the brutal proxy fight against the merger with compaq that lasted eight months, including a lawsuit to try and stop it. carly had to testify. >> all: [ chanting ] hpq! hpq! >> but in the end, the shareholders approved the deal, and she threw herself into marrying the two huge companies. with that came tough decisions, like laying off 23,000 people. grumbling about her intensified -- that she spent too much time hobnobbing with movie and rock stars, which she says was part of her campaign to appeal to a younger market. and there were complaints that she was weak at the day-to-day operations. do you acknowledge that you weren't running the nuts and bolts? >> no, i won't acknowledge that. i absolutely won't acknowledge that. i was running the nuts and bolts
11:56pm
of this company, along with a lot of other people. >> but do you acknowledge that the board felt you weren't? >> no. that's not factual. >> three members of the board approached her with a proposal to restructure the company in a way that, in part, would have stripped her of some of her day-to-day responsibilities. then, someone leaked the plan to the wall street journal. you were furious. you called a conference call with the board, and by your own account in the book, you were cold as ice. >> i was very, very distressed, but, as i also say in the book, when i get very angry, i get very quiet. >> did you scold them? did you talk down to them? >> i didn't talk down to them, but i was plain in saying, "this is unacceptable behavior." a line had been crossed, and when no one would fess up, i said, "we have to have an investigation." >> a leak investigation?
11:57pm
>> yeah, a leak investigation, because nobody would admit that they had talked to the press. >> she says her investigation didn't use pretexting or any other controversial tactics, but it didn't find the original leaker, though tom perkins admitted he was a second source who confirmed the story for the wall street journal. at the next board meeting, carly says she intended to clear the air and move forward, but when she showed up, she was fired, effective immediately, and pattie dunn was elected chairman of the board. >> in the book, you said, "the board did not have the courage to face me. they did not thank me. they did not say goodbye. they did not explain their decision or their reasoning. they did not seek my opinion or my involvement in any aspect of the transition." do you think it was nasty, mean, meant to hurt? >> well, if that was their intent, they certainly succeeded in that. [ laughs ]
11:58pm
maybe they took great pleasure in seeing me beat up publicly for weeks and weeks and weeks. i don't know. >> we wanted to hear the board's version of that story, but no one would talk to us. looking back, carly now believes that that leak investigation she ordered may have prompted some of the board members to turn against her. >> perhaps there were people who thought they would lose their job, and they loved being part of the hp board. >> you mean lose their job as a board member? >> yes, because of their own behavior. they loved being on the board. >> as she writes in her book, they may have thought it was them or her, so they decided to fire her first. she believes the ringleaders were tom perkins and his best friend, jay keyworth. >> did they collude and force this ouster? >> clearly, both of them were aligned in how they thought i should reorganize the business, but these were also people who really, for all their gifts and
11:59pm
all their accomplishments, didn't understand what running an $85-billion business was all about. >> but there were industry analysts who said it was carly who didn't understand, that her merger was failing, and that she had missed her own earnings projections. >> you missed a big quarter, but you don't just miss it. you miss it by 20% -- some huge amount, right? >> yeah. i'm not sure it was that, but it was a big miss. there's no question it was a big miss. >> as you admit, the stock price was down, and down considerably. aren't those enough reasons to fire a c.e.o.? >> they could be. they could be. but you would think if those were the reasons, that after all this heavy lifting and after all this work, at least the board would sit me down and say, "you know, carly, we think, unfortunately, that it's time to make a move, because," dot-dot-dot. "let's talk about these things." that conversation didn't happen.

Terms of Use (10 Mar 2001)